Which measure of portfolio performance allows analysts to determine the statistical significance of abnormal returns?
A) Sharpe measure
B) Jensen measure
C) Fama measure
D) Alternative components model (MCV)
E) Treynor measure

Question

Quizplus · Accepted Answer

The Jensen measure, also known as the alpha measure, calculates the performance of a portfolio by comparing its actual returns with the expected returns based on the level of risk taken. It allows analysts to determine the statistical significance of abnormal returns, which makes it a useful tool for evaluating investment managers.

Which Measure of Portfolio Performance Allows Analysts to Determine the Statistical